More money tapped for Houston's costly water meters

More funds tapped for water metersMillions more requested to fix automated system

BRADLEY OLSON, Copyright 2008 Houston Chronicle

Published 5:30 am, Saturday, October 4, 2008

In the last 10 years, the city has spent $47 million — almost twice the amount originally envisioned — installing an automated water meter reading system that has yet to reap any savings.

Now, the Department of Public Works and Engineering is asking for another $3.5 million even as officials acknowledge that more than 200,000 of the devices installed by a Washington-based vendor have had to be replaced. The city has more than 400,000 water customers.

City officials originally projected the automated system would pay for itself by 2003; they now say it will not reach that point until 2012.

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Mindful of past problems the city has had implementing new technology and software systems — some of which led them to take legal action against the contractor — the City Council tabled a vote on the $3.5 million request Wednesday.

"If you bought an Edsel and it was a bad car, very few people bought it the next time," said Councilwoman Toni Lawrence, citing a 1950s series of Ford-manufactured vehicles that failed spectacularly. "But we continue to buy Edsels sometimes with contracts (started) before this administration. We renew them."

Last month, the city negotiated a $5 million settlement with a company that designed a new Municipal Courts software system that has been plagued by problems almost from the outset. Last August, EarthLink agreed to pay the city $5 million for failing to meet deadlines implementing a citywide wireless Internet network, an initiative begun under Mayor Bill White.

Lawrence added that the council's focus on the meter contract extension will be an opportunity to examine instances when the system has billed people erroneously. The automated meters, which can be read by a computer as a city employee simply drives down a street, prompted numerous customer complaints about higher water bills as neighborhoods were added to the program.

Public Works spokesman Alvin Wright said many of the water meter devices the city bought broke due to "water intrusion on a mass scale.

"At the time of the original implementation, the application of this technology in a water utility was brand new," he said, noting that Houston was the first city to implement an automated in-ground water meter system. "The industry has advanced significantly since that time with several generations of the product having come and gone."

In 1998, a one-year warranty was the industry standard for the devices, officials said. That meant that when they broke, the city had to pay to replace them.

The battery-powered modules, which are fitted onto water meters, now have a full 10-year warranty, pro-rated for 10 years after that, with an expected battery life of 20 years.

The $3.5 million is being requested to address a range of problems that include replacing some devices that failed prematurely or at the end of their expected life cycles and performing a backlog of "system maintenance work," Wright said.

City Council has agreed to spend more money on the program and extend the original contract with Itron, Inc. three previous times. It began in 1998 as a $25.5 million deal. If the council approves the latest extension, the amount appropriated will total $50.4 million.

A spokeswoman for Itron declined to comment.

Wright said the department will recoup that amount and an additional $1.4 million in savings by 2012 and begin saving $4.5 million a year after that. Most of that is expected to come from needing fewer workers to manually record monthly water usage from meters.

"Last time we voted on this, we were told the technology had improved," Councilwoman Anne Clutterbuck said Wednesday, calling the number of devices that failed "staggering."

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"We need to know has it truly improved and is the failure rate down to something that is reasonable."